A year before World Cup, Russian clubs battle financial woes

FILE - In this Saturday, June 16, 2012 file photo Russia's Andrei Arshavin, right, leaves the pitch as Greek players celebrate their 1-0 win during the Euro 2012 soccer championship Group A match between Greece and Russia in Warsaw, Poland. Kuban Krasnodar's fans hoped signing Andrei Arshavin would herald long-awaited success for their club. The local governor hoped for a pre-election boost. (AP Photo/Thanassis Stavrakis, File)

MOSCOW (AP) — Kuban Krasnodar’s fans hoped that signing Andrei Arshavin would herald long-awaited success for their club. The local governor hoped for a pre-election boost.

By July 2015, Arshavin had lost much of the pace and attacking skill which made him a star in England for Arsenal years earlier, but he was still among Russia’s best-known footballers.

Like most Russian top-flight clubs, Kuban had a close financial relationship with the regional government, so Arshavin flew to the southern city of Krasnodar for a much-publicized meeting with governor Veniamin Kondratyev before signing a contract. The two posed for pictures in typical Russian official style, facing each other across a conference table with flags in the background.

Two months later, Kondratyev won re-election with 83 percent of the vote. Five months after that, as the Russian economy plunged, Arshavin left Kuban amid reports the club had stopped paying his 2.5-million-euro salary ($2.5-million).

Kuban was soon relegated and is now floundering in the Russian league’s second tier. Last month, local media reported it faced a lawsuit from tax authorities seeking to have the club declared bankrupt.

After years of the state bankrolling big-money transfers and foreign stars’ wages, many Russian clubs are in financial trouble, even as the country prepares to host next year’s World Cup.

“Twenty-five percent of the clubs in the Premier League have wages delayed, and in the second division, the FNL, it’s 50 percent,” says Nikolai Grammatikov, head of one of Russia’s two competing players’ unions.

“We expect that the next year’s going to be even tougher,” Grammatikov adds. “I don’t want to have a professional club if I am a regional governor because it’s too much expense.”

In an ominous sign for the legacy of next year’s World Cup, just five of the 11 host cities will have a Premier League club next season, with the other six represented in the lower divisions, where financial problems are typically more severe.

Regional governments and state-owned companies, like Zenit St. Petersburg’s owner Gazprom, own more than half of clubs in the top flight and almost all in the second tier. Several other clubs have close commercial links with government organizations.

With the Russian government having slashed spending on social services recently, paying large sums to rich players is an extra burden for state officials. It’s less attractive for the state as a PR instrument, too, following recent poor results in European competitions by Russia’s clubs and the national team, says Russian football writer Evgeny Dzichkovsky.

“There’s just no money,” Dzichkovsky says. “Earlier (state officials) sometimes sacrificed other areas for football, but that’s harder now because of the contrast between football clubs and the rest of society. There’s also the difference between the level of income and the level of skill, given our recent performances.”

Russian clubs have little opportunity to emulate teams in Europe’s other top leagues, raking in money from fans directly through ticket sales and indirectly through TV rights. Attendances for Russian Premier League games have averaged around 11,500 this season, on a par with Belgium.

With large banks of empty seats at most top-flight games, the atmosphere is often underwhelming. Crowd trouble is less of an issue than in the 1990s and early 2000s, when hooligans often ruled stadiums, but there has been occasional disorder this season.

Many Russian fans prefer to watch games at home on TV, and some prefer the English or Spanish leagues.

A UEFA report in January said Russian Premier League clubs make just four percent of their income from ticket sales and five percent from TV rights, by far the lowest proportions in Europe’s 10 biggest leagues.

That means a heavy reliance on state backers at most clubs, with the exception of a select few like Spartak Moscow which are reliant on wealthy benefactors who sink money into the team with little or no hope of making a profit.

That hasn’t happened, and instead it’s China which has become big European teams’ main rival while Russian teams like Zenit and CSKA Moscow have slashed transfer spending. Hulk and Witsel now play in the Chinese league.

Many provincial Russian teams have been struggling to survive, potentially creating difficulties for legacy after next year’s World Cup.

FC Rostov, which will move into a 45,000-seat stadium after the World Cup, competed in the Champions League this season despite repeated wage delays for its player in the preceding months. Players at Mordovia Saransk, another team from a host city, reportedly went on strike earlier this year in protest at unpaid wages. Mordovia has since been relegated to the third tier.

Clubs in the host cities of Sochi, Volgograd and Nizhny Novgorod have also had severe financial problems in the last five years, and it’s difficult to see how they’ll fill the vast arenas they’ll be left with after the World Cup.

“You don’t need so many stadiums, you need more academies,” says Grammatikov, who warns that clever marketing from foreign leagues could stop Russian clubs ever recovering lost ground.

“Russian clubs didn’t realize, but they lost the market,” he says. “If you want to watch football Saturday night, you have Rubin Kazan against Dynamo for instance, next season, and at the same time we have Arsenal against Liverpool. And guess what, you have a Russian commentator (for the English game) and through social media, you know more about the lives of these players. They’re more attractive.”